Spotify Stock: A Quick Assessment
Spotify the product is benefiting me as a user too much. In this post; the company financials, Joe Rogan, and what I think Spotify the company should do soon.
I was going though some old emails this morning and it occurred to me that Spotify SPOT 0.00%↑ emailed me A LOT in December - 8 times. Spotify is one of the few products that I interact with probably every single day. Strangely, I’m not a premium user of the platform because the ads haven’t bothered me enough yet - and this gets us to the emails. As an ad-supported user, the company emails me with the carrot of a free premium subscription trial on a regular basis. This is to be understood since the gross margin on my usage is statistically putrid:
Sooner or later I’m sure I’ll bite the bullet and do premium but the promo email purge got me thinking about Spotify the business. 8 times in December seemed like a lot…
After about 5 minutes of research, turns out that was about the same amount of promo carrots as December 2021 as well - 7 emails. All part of the company’s user conversion plan it seems. I’ve owned Spotify stock previously but when the broad market had problems last year, I had to make some tough calls and Spotify didn’t make it in the portfolio. It’s been a bit since I got under the hood so I decided to take a look at the financials again.
Key Figures
As is often the case in growth stonks, the top line revenue figures and sexy numbers like user growth look good. Total revenue was up 21% year over year in Q3 and total MAUs were up 20% to 456 million monthly active users (so much for the Joe Rogan drama exodus - more on him in a moment):
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